2021 Leg Session, Energy, Environment, Gold Dome, Governor Polis, Original Report, Public Utilities Commission, Scott Weiser, Uncategorized

From advocacy to activism; state’s utility watchdog faces sea-change in legislature

DENVER–A Democrat-controlled state Senate committee last Thursday advanced a significantly amended bill reauthorizing Colorado’s Office of Consumer Counsel (OCC). But the changes being proposed to the agency, historically tasked as the state’s independent utility customer watchdog group, appear to shift the OCC away from ratepayer protection and towards environmental and renewable energy advocacy, under the thumb of Governor Polis.

In various intervals prescribed by law, many of the state’s agencies, boards or government programs must undergo a “sunset review” to ensure that they are needed and are operating in the public interest. The review culminates in the legislature either reauthorizing the agency, board, or program or allowing it to expire.

Last year the Office of Consumer Counsel (OCC), along with the advisory Utility Consumer’s Board (UCB) underwent such a review.

In response to the sunset report issued October 15, 2020 by the Department of Regulatory Agencies (DORA), Senate Bill 21-103 was introduced by Senate Majority Leader Stephen Fenberg, D-Boulder and Sen. Faith Winter, D-Westminster. The bill was heard before the Senate Transportation and Energy Committee Thursday, March 25 and an amended version was passed on to the Senate Appropriations Committee on a 4-3 party-line vote.

OCC as utility watchdog

The OCC was created in 1984 to “provide quality representation for agricultural, residential and small business utility consumers as classes of ratepayers, not as individuals” in proceedings before the Colorado Public Utilities Commission (PUC) related to natural gas, electric and telephone utilities.

Originally housed under the Attorney General’s (AG) office, the OCC was relocated to the Department of Regulatory Agencies (DORA) in 1993, but as Type 1 agencies, neither the OCC nor the UCB were under the supervisory control of the executive director of DORA.

Telephone utilities were removed from that mandate in 2015 with the federal deregulation of telecommunications.

In its report DORA finds that the OCC and the UCB remain necessary and are operating efficiently. One section analyzes the bang-for-the-buck of the agency and concludes that for every dollar spent on the OCC, consumers save more than $63. From fiscal 2014 through fiscal year 2019, the OCC has saved Colorado electrical and gas customers more than $565 million by intervening in rate cases and other actions before the PUC on behalf of consumers, who have very little hope of understanding or challenging the extremely complex decisions the PUC makes on a regular basis.

A shift from advocacy to activism

The report also made multiple recommendations to the legislature, some of which are housekeeping measures such as renaming the OCC as the Office of the Utility Consumer Advocate to clarify its function to the public, who often call the office with complaints about “insurance, automobile dealerships, legal advice and credit reporting.”

But other provisions in the now modified bill shift the OCC away from consumer protection and advocacy and towards enforcing Governor Polis’ and the Colorado Energy Office’s self-redirected focus on “reduc[ing] greenhouse gas emissions.”

The amended bill now requires the Director (renamed from Counsel) to give due consideration to “statutory decarbonization goals,” “just transition” and “environmental justice,” among other things, rather than energy economics when deciding whether to intervene in a PUC case.

Perhaps the most important change in the bill is converting the UCB from a Type 1 to a Type 2 agency. As Type 1 agencies both the OCC and UCB are independent of supervision by DORA, but changing the advisory UCB to a Type 2 agency would make its decision making subject to oversight by DORA’s executive director Patty Salazar, an appointee of Governor Polis.

Regulatory attorney Shayne Madsen, Director of the Political Law Center at the Independence Institute in Denver, voiced serious concerns about the bill.

“I am very concerned about changing the status of the advisory board from a type 1 to a type 2 agency,” Madsen told Complete Colorado. “Under current law the advisory board members are appointed by the governor and House and Senate Leadership.  The advisory board operates independently of partisan concerns and special interests and reviews data, studies and other information and makes recommendations to the OCC on policy and regulatory actions.  By changing the advisory board to a type 2 agency the proposed legislation places the executive director of DORA in a supervisory role, able to dictate policy guidance to the advisory board, effectively neutering its functions.”

Another change made by the bill is to add back “telecommunications services” to the OCC’s powers of intervention. According to testimony at the hearing the only component still under PUC regulation is 911 services.

Another controversial amendment forbids the OCC from recommending “that the commission take any action that would interfere with” wages, health insurance or retirement benefits of labor unions.

A ‘weaponized commission’

In an interview with Complete Colorado, Senator Ray Scott R-Grand Junction, who sits on the Transportation and Energy Committee and voted against the bill, expressed concerns that the OCC and UCB will become tools of Governor Polis’ anti-fossil-fuels policies rather than being an independent consumer advocate.

“I think what we’re seeing [government wide] is commissions being filled by the governor with idealogues that represent what he wants to accomplish with his green energy program,” Scott said. “And then they’re coming up with policies that are helping to weaponize these commissions to enforce their ideology. And we’re not just seeing it with the OCC, we saw that this week, but we saw with the PUC last year, and we’ve seen it with other commissions [setting] policies to do the governor’s bidding.”

Scott says that the radical changes to the UCB and OCC taking place now are opportunistic attempts to force legislators to hold their noses and approve the reauthorization despite the objectionable green energy agenda.

“It’s drifting away from its original charge,” Scott said. “And it’s unfortunate. Why would you do this in a sunset [review], except to try to trap people with their votes? It’s because we like the OCC. But then you add all these Christmas tree ornaments on it to make it very unpalatable to people that are not following the same ideology that they are.”

Scott feels that shifting the focus of the OCC and the mandate of the UCB away from saving consumers money on energy is a bad idea.

“I find it unfortunate because we had a nice little commission that did good work,” said Scott. “They did things to protect the less fortunate among us. They did a lot of work for seniors because they have a limited income. But now they’re being weaponized to just talk about what the legislators want them to talk about, or what the governor wants them to talk about, and I find that very unfortunate. I think in the years ahead they’re not going to be the same agency that they were.”

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